Retrospective Rating Program Overview Presented by: Ashley Frank and Tim Smolen

What is Retro?  Retro is a voluntary program for State Fund employers.  Retro rewards employers who minimize their claim costs by refunding a portion of their worker’s compensation premium.  Retro involves risk. Failure to minimize claim costs can result in having to pay an additional assessment. 1

Who is in Retro?  Retro includes 47 trade associations, representing 12,151 member accounts.  An additional 303 individually enrolled accounts.  Approximately 40% of premiums are from employers enrolled in Retro ($751 million of $1.86 billion). 2

State Agencies in Retro  State of Washington Retro Group  Operated by Department of Enterprise Services  39 State Agencies are enrolled  State Agencies enrolled as Individual participants  Labor and Industries  Office of Financial Management  Liquor Control Board  Utility & Transportation Commission  Home Care Referral Registry (HCRR)

How does Retro work?  Employers sign up for a 12 month plan year starting in a specific quarter.  10 months after plan year has ended, a “snap shot” is taken of all premium and claim activity that occurred during that plan year. –The date the snap shot is taken is known as the “freeze date” or valuation date. 3

Adjustment Timeline for April 1 st thru March 31 st Coverage Year CY 4/1/14 - 3/31/15 CY 4/1/15 - 3/31/16 CY 4/1/16 - 3/31/17 Jan Jan Jan Jan Jan = freeze date, approximately one month prior to adjustment date. 4

How Are Refunds/Assessments Determined?  The Retro participant signs an annual contract with the Department.  The participants customize their contract to define: –The amount of risk they’re willing to take, –The level of claim costs permitted before getting an assessment, and –The amount of potential reward they’re able to earn. 5

How Are Refunds/Assessments Determined? (cont.)  If claim costs captured at the time of the freeze date are lower than the predetermined amount, a portion of the premiums are refunded.  If claim costs captured at the time of the freeze date are higher than anticipated, then additional premiums will be assessed, up to a predetermined maximum amount. 6

Retro Refunds for State Agencies  Refunds go into fund 03K  A request must be submitted to use the funds  Funds must be used towards safety investments, such as: –Riser Desks –Return to Work –Training/Education 8

Retro Success Is Intentional! Step 1 – Prevention  Safety, Safety, and more SAFETY!  Successful Safety & Accident Prevention Programs  Commitment, Involvement & Communication Step 2 – Management  Accident Investigation  Early and Safe Return to Work  Effective Claim Management 10

True costs of a claim  Down time & lost productivity  Increased absenteeism and turnover  Time spent investigating incidents and administering claims  Hiring replacement workers, paying overtime and/or re-training Costs covered by premiums Uninsured costs 11

Questions?